I did a little more digging. This guy said that the hose was needed to make sure the air coming out wasn't hot. Because hot air going into a filter will not yield water. So having the long hose allows the air to cool first then it gets filtered?
I can see where he's coming from, but I don't know if this is really true.
The higher the temperature of the air, the greater its capacity to hold moisture. As the air cools, held moisture will condense out making it easier for it to be captured by the filter.
If space is at a premium consider plumbing in an aftercooler. It can by DIY (a zig-zag of copper pipe for example) or something like
a Derale 15300 to help cool the air and to encourage held moisture to condense. Add a drop and a purge valve to physically remove the condensate from the line, then your filter comes afterwards.
You'd want to pitch the system as needed for drainage.
If you use your compressor a little bit here and a little bit there, the temp of the compressed air from the occasionally running compressor will generally not get as high as if the compressor was running more continually when it's feeding a tool with a higher CFM requirement.
Some tools/applications water can be bad for; spraying paint, using a plasma cutter, etc. Others like powering a die grinder, not as bad.